Kenworth will all but shut down production at its Renton, Wash., truck plant, when it lays off more than 400 employees at in January, according to published reports.


A union official told the Seattle Times newspaper that Kenworth will stop building highway heavy-duty trucks in Renton and produce only two off-road trucks a day there. Production of conventional highway trucks will reportedly be shifted to Kenworth's Chillicothe, Ohio, plant.

In its third quarter earnings report last month, Paccar noted that declining housing starts and auto production have impacted U.S. and Canadian Class 8 truck sales throughout 2008 and predicted retail sales to only total about 150,000 this year. Company officials reported they don't expect sales to improve until the second half of next year, and then only slightly, with sales for 2009 expected to be in the range of 170,000-210,000.